UNCDF has been present in Bangladesh since 1982. In that time, UNCDF has supported Bangladesh in strengthening agricultural development, inclusive digital economies, decentralization and local service delivery.
Today, UNCDF offers catalytic finance models that unlock public and private resources in the “last mile” environments, especially at domestic level, to reduce poverty and support local economic development and inclusive digitalization of the economy.
Women’s economic empowerment
UNCDF supports women’s economic empowerment and women-led micro, small and medium enterprises (MSMEs) in Bangladesh by mobilizing capital and de-risking investments. UNCDF, with the United Nations Development Programme (UNDP) and UN Women, collaborated on the joint programme ‘Women’s Economic Empowerment for Inclusive Growth (WING)’. This programme invested US$168,740 in nine social enterprises, which unlocked $1,002,615 and created 282 jobs for women.
During COVID-19, the government of Bangladesh used a UNCDF-supported credit guarantee scheme as a mechanism to finance affected MSMEs.
UNCDF also fosters private sector innovations, through de-risking the development and expansion of digital business models and solutions, that alleviate constraints faced by women-led enterprises. Grants, complemented by technical assistance, help unlock public and private sector finance to support local governments, social enterprises, cooperatives and fintechs.
Financial and digital literacy of MSMEs
UNCDF in Bangladesh supports providers to advance MSMEs’ financial and digital skills and capabilities and develops digital solutions for them. This includes digital payments, insurance, e-commerce platforms, recordkeeping applications, digital and financial literacy tools, digital business support solutions and digital loan platforms. UNCDF is also helping to create financial and digital literacy solutions for garment workers. We take an integrated approach to digital and financial capabilities by ensuring that these can be offered to the last mile in a sustainable manner.
Integrated National Financing Framework for the SDGs
In partnership with the International Labour Organization (ILO), UNDP and UN Women, UNCDF advances the Integrated National Financing Framework (INFF) for the Sustainable Development Goals (SDGs) in Bangladesh. UNCDF is conducting a fiscal spacing exercise in the country to ensure effective and SDG-linked use of fiscal resources. UNCDF is working closely with the government to develop the financing strategy roadmap for SDG 7 on affordable and clean energy and is devising a domestic savings mega-fund to mobilize domestic micro-savings towards clean energy investments in Bangladesh.
Local Government Initiative on Climate change
The performance-based climate resilience grants (PBCRG) model has been successfully integrated into the Bangladesh intergovernmental fiscal transfer system. It channels additional resources to local governments and supports projects focusing on the adaptation needs through the Local Government Initiative on Climate Change (LoGIC), funded by Sida and the European Union, with input from UNDP and UNCDF.
LoGIC introduced earmarked grants for locally-led climate change adaptation in seven climate vulnerable districts. As of December 2021, 697 small-scale climate resilience schemes had been financed under LoCAL in Bangladesh. The investments delivered direct results for approximately 859,000 people across 72 parishads.
The LoCAL and LoGIC implementation also contributed to the development of the Local Climate Financing Framework, a state-of-the-art accounting and management information system and adaptation tracking and measuring software, and the ongoing development of a climate vulnerability index to map exposure, sensitivity and adaptive capacity of all union parishads in the country.
Sustainable Food Systems Finance
UNCDF provided concessional financing to de-risk investment in a social enterprise for orange-fleshed sweet potatoes. This blended finance investment has unlocked a commercial loan and a contribution from the local government, providing job opportunities for 5,000 farmers (3,000 women) and increasing farmers’ income by 25 percent.
UNCDF is working with Narail municipality to set up a growth centre for marginalized women to provide market access to sell their products and encourage them to amplify their voices in decision making. As part of its SDG-cities initiative, UNCDF is piloting the IncluCivity Index and city scorecard in selected municipalities led by women mayors.
Migration and remittances
UNCDF works with private sector partners to pilot and scale business models reaching migrants and their families to improve their financial health. UNCDF aims to accelerate innovations by bringing together financial service providers, who offer the ‘rails’ for digital services, with fintech companies and digital disruptors working on ‘jobs-to-be-done’ solutions. The overall focus is on migrant-centric product development mechanisms into the providers’ day-to-day business processes to ensure the products’ sustainability and scalability while crowding in new providers.
Better Than Cash Alliance
Bangladesh has been a member of the UNCDF-hosted Better Than Cash Alliance (BTCA) since 2015. BTCA supported two country diagnostics for digital payments and structured assessment on the state of the digital payments ecosystem and way forward. It has supported the development of EkPay Platform, the national platform for person to government payments. BTCA has championed the wage digitization agenda in Bangladesh, organized the inaugural Digital Wages Summit 2019 that brought together stakeholders of the ready-made garment ecosystem. BTCA also helped to launch the flagship National Digital Payments Roadmap 2022-2025, which has potential to add 1.7 percent to Bangladesh GDP.